SAN FRANCISCO – In a setback for Uber, a federal judge on Wednesday vastly expanded the scope of a class action lawsuit against the ride-hailing company.
The case revolves around Uber drivers in California who contend they are employees and therefore should be reimbursed for expenditures or losses incurred during the discharge of their duties. It is set for trial in the summer.
In a previous ruling, U.S. District Judge Edward Chen said only California Uber drivers who started with the company prior to June of 2014 could be included in the case. That was when Uber added language to its contracts that required drivers to agree to mandatory arbitration.
In Wednesday’s ruling, Chen said that those drivers could also be included in the case.
That would mean the vast majority of people, close to 160,000, who have ever driven for Uber in California could potentially be part of the suit.
Uber’s business model is based upon it merely being a conduit between drivers and riders, not an employer.
Wall Street likes that model. Just last week it valued the company at $62 billion.
Uber strongly disagreed with Chen’s ruling.
“Nearly 90 percent of drivers say the main reason they use Uber is because they love being their own boss,” said Uber Technologies spokesperson Jessica Santillo.
“Drivers use Uber on their own terms; they control their use of the app along with where and when they drive. As employees, drivers would lose the personal flexibility they value most — they would have set shifts, earn a fixed hourly wage, and be unable to use other ride sharing apps.”
Santillo said Uber would appeal the district court’s decision immediately.
A request for comment from the Boston-based lawyer representing the drivers, Shannon Liss-Riordan,was not immediately answered.
In another hit for Uber, Chen also ruled that drivers have the right to seek reimbursement for part of their cell phone bills as well as car expenses, using the Internal Revenue Service rate of 57.5 cents per mile.
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